JPMorgan Chase Faces U.S. Order to Improve Compliance

A U.S. regulatory probe of JP
Morgan Chase & Co is expected to result in an order that
the bank correct lapses in how it polices suspect money flows,
in an action expected as soon as Friday, people familiar with
the situation said.

A U.S. regulatory probe of JP
Morgan Chase & Co is expected to result in an order that
the bank correct lapses in how it polices suspect money flows,
in an action expected as soon as Friday, people familiar with
the situation said.

The action would be in the form of a cease-and-desist order,
which regulators use to force banks to improve compliance
weaknesses, the sources said.

The order is expected to be issued by the Office of the
Comptroller of the Currency and the Federal Reserve.

JP Morgan is not expected to pay a monetary penalty,
according to one person familiar with the situation.

The Treasury Department's anti money-laundering unit, the
Financial Crimes Enforcement Network, also could take a separate
action against the bank.

A JP Morgan spokeswoman declined comment.

The status of the inquiry could change and the timing of the
action could extend to next week or later.

The JP Morgan inquiry dates back several months, according
to people familiar with the probe. Under the order, the bank is
expected to be required to bolster systems it uses to monitor
risk and transactions.

The order is the latest action that U.S. regulators have
taken this year to force banks to tighten their anti money-
laundering systems, which are supposed to flag suspect
transactions from sanctioned countries or those from customers
with ties to drug trafficking or terrorism.

Britain-based bank Standard Chartered Plc agreed to
pay a total of $667 million to U.S. and state regulators to
resolve anti-money laundering probes, while HSBC Holdings Plc
, also headquartered in Britain, agreed in December to
pay $1.9 billion to settle a U.S. inquiry.

In April, the Comptroller of the Currency identified major
lapses in compliance systems at U.S. bank Citigroup Inc,
though Citigroup didn't pay a monetary penalty.

(Reporting by Carrick Mollenkamp and Emily Flitter of Reuters,
and Brett Wolf of the Compliance Complete service Thomson
Reuters Accelus; Editing by David Holmes)